Recommendations On Guidelines on Spectrum Sharing · Recommendations on “Guidelines on Spectrum Sharing” to the DoT on 21st July 2014. 3. Many of the recommendations have been

Recommendations

On

Guidelines on Spectrum Sharing

(Response to reference received from Department of

Telecommunications on recommendations of

21st July 2014)

21st May 2015

Mahanagar Doorsanchar Bhawan,

Jawahar Lal Nehru Marg, New Delhi-110002

Telecom Regulatory Authority of India

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CONTENTS

CHAPTER-I: INTRODUCTION ........................................................... 1

CHAPTER-II: PARAWISE RESPONSE ................................................ 2

1

CHAPTER-I: INTRODUCTION

1. In India, there are 7-13 licensees (2G, 3G and BWA) in a Licensed

Service Area (LSA), which is a large number by any global standard1.

As a result, spectrum holding per Telecom Service Provider (TSP) is

small and fragmented. Spectrum fragmentation results in its less

efficient utilisation. The basic objective of spectrum sharing is to

provide an opportunity to the TSPs to pool their spectrum holdings

and thereby improve spectral efficiency. Sharing can also provide

additional network capacities in places where there is network

congestion due to a spectrum crunch.

2. To prepare its recommendations on ‘Guidelines for Spectrum

Sharing, the Authority constituted a Steering Committee of senior

officers of TRAI and representatives from various TSPs. Views of the

Steering Committee were considered by the Authority before

finalising these recommendations. The Authority had sent its

Recommendations on “Guidelines on Spectrum Sharing” to the DoT

on 21st July 2014.

3. Many of the recommendations have been referred back by the DoT to

the Authority for reconsideration through its letter dated 27th April

2015. The Authority has gone through the DoT’s views on various

recommendations and finalized its response. The Authority’s earlier

recommendations, the views of the DoT thereon, and the response of

the Authority are provided in Chapter II.

1 Many countries have only 4-5 licensees such as UK-4, Denmark-4 and Sweden-5.

2

CHAPTER-II: PARAWISE RESPONSE

1. Para 2.1

Spectrum sharing refers to an arrangement between two access

licensees (CMTS/UASL/UL (AS)/UL) in a LSA, where both licensees

having access spectrum in the same band, pool their respective

spectrum in that LSA for their simultaneous use, using a common

Radio Access Network (RAN)2. The shared RAN will be connected to

the core networks of each of the licensee. Both licensees will continue

to hold their primary right over their own spectrum.

2 RAN refers to access network up to BSC in 2G network, while in 3G networks, it

refers to access network upto Radio Network Controller (RNC) and is known as Universal Terrestrial RAN (UTRAN).

(TRAI Recommendation)

DoT View

Licensees having access spectrum as defined in UL will be permitted

to share the spectrum in an LSA. Apart Basic/CMTS/UASL/UL (AS)

licensees, ISPs may also be included as eligible.

Response of TRAI

It is essential to ensure that both the licensees pool (combine)

their spectrum resources and also use it simultaneously;

otherwise it would be akin to spectrum leasing. Therefore, it is

required to define the spectrum sharing the way it has been

recommended above.

Sharing of spectrum is a new concept. Therefore, to begin with,

spectrum sharing, may be allowed only for the access service

providers (CMTS/UASL/UL (AS)/UL with authorization of Access

Service)

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2. Para 2.3

Only those sites shall be treated as spectrum-shared sites, where the

spectrum resource of each of sharing licensees is used in the BTS.

Both the licensees will be required to have a common RAN only in

respect of sites being shared. It shall be up to the licensees to decide

the actual area/BTSs in the LSA where they want to pool and share

their spectrum resources as per their requirement and mutual

agreement. However, it is simply not possible to monitor quantum of

spectrum being shared at each site and to segregate the AGR site-

wise/area-wise. Therefore, for the purpose of charging Spectrum

Usage Charges (SUC), the licensor shall consider that the licensees are

sharing their entire spectrum holding in the particular band in the

entire LSA.

Example 1: Licensees ‘A’ and ‘B’ have 8 MHz and 5 MHz spectrum

respectively in the 1800 MHz band in Delhi LSA. Each of them pool 4

MHz and builds a common RAN. This arrangement of spectrum

sharing is permissible. However, for the purpose of charging SUC, it

will be considered that the licensee ‘A’ and ‘B’ are sharing their entire

spectrum holding in 1800 MHz Band (i.e. 8 MHz and 5 MHz spectrum

respectively).

Example 2: Licensees ‘A’ and ‘B’ have 8 MHz and 5 MHz spectrum

respectively in the 1800 MHz band in Delhi LSA. Each of them pools

their spectrum holding and builds a common RAN only in say

Connaught Place area, whereas in other parts of the LSA, they do not

share their spectrum. Such arrangement of spectrum sharing is

permissible. However, for the purpose of charging SUC, it will be

considered that the licensee ‘A’ and ‘B’ are sharing their entire

spectrum holding in 1800 MHz Band in the entire Delhi LSA.


4

DoT View

For the purpose of charging Spectrum Usage Charges (SUC), it is to

be considered as the licensees are sharing their entire spectrum

holding in the particular band in the entire LSA, the concept of

spectrum – shared site does not have any relevance for this

purpose.

Response of TRAI

As recommended by the Authority, for the purpose of charging

Spectrum Usage Charges (SUC), the licensor shall consider that

the licensees are sharing their entire spectrum holding in the

particular band in the entire LSA. Regarding applicable rate of

SUC, please refer to Para 2.22 of the recommendations.

However, it shall be up to the licensees to decide the actual

area/BTSs in the LSA where they want to pool and share their

spectrum resources as per their requirement and mutual

agreement.

In view of the above, the Authority reiterates its

recommendation.

3. Para 2.4

All access spectrum i.e. spectrum in the bands of

800/900/1800/2100/ 2300/2500 MHz will be sharable provided

that both the licensees are having spectrum in the same band.

Example: It has been assumed that two Licensees ‘A’ and ‘B’ have

spectrum holding in 900 MHz, 1800 MHz and 2100 MHz band as

shown in Table below:

Licensee Licensee A Licensee B

Spectrum Band 900 MHz

1800 MHz

2100 MHz

900 MHz

1800 MHz

2100 MHz

Spectrum holding (MHz) 6.2 3 0 0 4.4 5

5

These two licensees can share their spectrum holding in the 1800

MHz band because both of them have spectrum in this band.

However, they cannot share spectrum in 900 MHz or 2100 MHz band

because only one of them has spectrum in these bands.


DoT View

TRAI is requested to clarify whether spectrum acquired through

trading can also be shared.

Response of TRAI

Yes, spectrum acquired through trading can also be shared.

4. Para 2.7

A licensee shall not be eligible to share its spectrum if it has been

established that it is in breach of terms and conditions of the licence

and the licensor has ordered for revocation/termination of its licence

after giving appropriate opportunity.


DoT View

TRAI is requested to provide clarification of the following:

(i) What should be done during notice period for termination/ revocation of the license or when such a notice is contemplated?

(ii) What should be done when there are court cases against such

notices?

Response of TRAI

The Authority reiterates its earlier recommendations.

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5. Para 2.8

Both the licensees, willing to share their spectrum, shall inform the

licensor at the time of entering into spectrum sharing agreement. No

permission will be required from the Government for spectrum sharing.

However, the Government shall have the right to annul the spectrum

sharing agreement, if found to be flouting prescribed guidelines after

giving due opportunity to the licensees. (Process described in Para

2.15 to 2.19)


DoT View

TRAI is requested to provide suggestions for making amendments in

license agreements/wireless operating licence and any other steps to

be taken for sharing of spectrum.

Response of TRAI

The Authority is of the opinion that after finalisation of

guidelines of spectrum sharing, the DoT may carry out

appropriate modifications in the various clauses of the relevant

licenses.

6. Para 2.9

At present, there are many licensees having administratively assigned

spectrum in the 800 MHz, 900 MHz and 1800 MHz band. If any one or

both of the licensees, sharing their spectrum, have administratively

assigned spectrum in that band, then, after sharing, they will be

permitted to provide only those services which can be provided

through the administratively held spectrum.

Example: If one of the licensees has liberalised spectrum in 1800MHz

band and other licensee, sharing the spectrum, has some spectrum as

administratively held spectrum and some spectrum as liberalised

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spectrum in the same (1800MHz) band, then, after sharing their

spectrum they can provide only GSM based mobile services.


DoT View

(i). TRAI is requested to recommend methodology for liberalization of

900 MHz band spectrum.

(ii). Following the principle of allowing use of any technology, TRAI is

requested to consider that sharing of spectrum be permitted in

respect of liberalized spectrum i.e. when both licensees have paid

market price of the spectrum held by them which is proposed to

be shared.

Response of TRAI

(i) & (ii)

As brought out in Para 1.1 of the recommendations, the basic

objective of spectrum sharing is to provide an opportunity to

the TSPs to pool their spectrum holdings and thereby

improve spectral efficiency. Sharing can also provide

additional network capacities in places where there is

network congestion due to a spectrum crunch. Liberalisation

of spectrum is related to the liberty to use any technology.

Therefore, the Authority has recommended in Para 2.9 above

that if any one or both of the licensees, sharing their

spectrum, have administratively assigned spectrum in that

band, then, after sharing, they will be permitted to provide

only those services which can be provided through the

administratively held spectrum.


recommendations.

8

The issue of liberalisation of 900 MHz band spectrum is not

related to spectrum sharing guidelines.

7. Para 2.10

If both the licensees are sharing the spectrum in a band in which they

have only that spectrum which is either acquired through an auction

in the year 2010 or afterwards, or on which the licensee has already

paid the prescribed market value3 (as decided by the Government

from time to time) to the Government, they can offer services using all

those technologies (namely GSM, CDMA, WCDMA, LTE etc.), which

they can independently provide through their own spectrum holding.

For this purpose, the licensees are required to own a certain minimum

amount of spectrum in that band throughout the currency of sharing.

3The prescribed market value shall be payable to the Government for the

entire administratively assigned spectrum in that band after adjusting the

entry fee paid by the Licensee for acquiring the spectrum (bundled with

licence) prorated for the remaining validity of spectrum.


DoT View

It is understood that prior to sharing of administratively assigned

spectrum market price has to be paid for such spectrum to DoT.

However, use of technology shall be governed by the terms and

conditions of respective NIA/ license.

TRAI in its recommendations of May 2010 recommended, among

others, that spectrum sharing will not be permitted among licensees

having 3G spectrum. Further TRAI has not defined the minimum

amount of spectrum to be owned by the licensees throughout the

currency of sharing.

TRAI is requested to clarify the above.

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Response of TRAI

As stated in the response to Para 2.9, the Authority is of the

view that it is not required that prior to sharing of

administratively assigned spectrum market price has to be paid

for such spectrum.

As brought out in Para 1.1 of the recommendations on spectrum

sharing, the basic objective of spectrum sharing is to provide an

opportunity to the TSPs to pool their spectrum holdings and

thereby improve spectral efficiency. Therefore, the Authority

does not find any plausible reason to exclude spectrum in 2100

MHz band from the list of the spectrum bands that can be

shared.

Both the licensees are required to fulfil specified roll-out

obligations and prescribed QoS norms. Moreover, subsequent to

sharing the licensees can offer only those services which they

can offer through their own spectrum holding. To fulfil all these

required obligations, the licensee itself can determine the

minimum spectrum holding that it is required to hold.

8. Para 2.11

Both licensees shall ensure that they fulfil the specified roll-out

obligations and specified QoS norms.


DoT View

The primary purpose behind roll out obligations is that spectrum is

used by the licensee in a timely manner and that networks spread to

wider parts of the service area. This also helps in improved

probability of network infrastructure availability during disaster.

Hence, it is considered necessary that licensees should meet their

roll out obligations without shared sites/RAN. Once roll out

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obligations are met, the sites used for meeting roll out obligations

may be shared. This will also be in line with TRAI recommendation

in para 2.21 below.

All obligations with respect to license conditions including for lawful

interception and security shall be the individual responsibility of

each licensee.

TRAI is requested to provide its considered opinion in this regard.

Response of TRAI

The Authority agrees with the view of the DoT that all

obligations with respect to license conditions including for

lawful interception and security shall be the individual

responsibility of each licensee. Being part of the licence, both

licensees shall also be bound with the roll-out obligations and

QoS norms. However, while testing roll-out obligations of each

licensee, TERM Cell should ensure that only the spectrum

resources assigned to that licensee are tested, irrespective of

the fact whether the licensee has separate RAN or not.


recommendations.

9. Para 2.12

For sharing spectrum, a non-refundable processing fee @ Rs.50,000/-

(Rs. Fifty Thousand) will be payable individually by each licensee for

each LSA to WPC for administrative purposes.


DoT View

TRAI is requested to kindly indicate the rationale for recommending

Rs. 50,000/- as processing fees.

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Response of TRAI

The processing fee is being imposed to cover the administrative

charges. Therefore, the Authority has recommended a nominal

amount of Rs. 50,000/- as processing fees.

10. Para 2.14

Both licensees will give an undertaking that, in case any interference

is arising due to sharing of their spectrum, they will resolve it within

30 days failing which they will stop sharing in the affected areas till

the problem of interference is addressed.


DoT View

The period of 30 days shall be reckoned with effect from date of issue

of notice by the Government to resolve the cases of harmful

interference.

Response of TRAI

The Authority agrees with the DoT’s view.

11. Para 2.20

Intimation regarding the sharing shall be provided by both the

licensees to the licensor, TRAI and any other relevant agencies

prescribed by the Government from time to time within 30 days from

the effective date of sharing of spectrum.


DoT View

Views in para 2.8 above may be referred.

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Response of TRAI

TRAI’ Response given in Para 2.8 may be referred to.

12. Para 2.22

SUC post-sharing:

Spectrum sharing does not give exclusive rights of use to any one

licensee. It helps create additional capacity that is useful mainly in

those areas where anyone or both licensees are facing a capacity

crunch. Therefore, the usefulness of gain in spectral efficiency due to

pooling of spectrum resources will be limited only to those areas

where there is congestion in the access network. Moreover, both

licensees will be tied to each other and as such cannot plan the

expansion of their shared network independently. Therefore, access to

additional capacities created through spectrum sharing cannot be

considered at par with that created through spectrum acquired

through auction/trading. Sharing of spectrum by the two licensees will

result in higher revenues for both of them. Therefore, both the licensee

will also pay higher amount of SUC to the Government. However,

considering the fact that spectrum sharing results in additional

quantity of spectrum with both the licensees to serve higher number of

consumers, the SUC rate of each of the licensees post-sharing shall

increase by 0.5% of AGR.

Example: It has been assumed that two Licensees ‘A’ and ‘B’ have

spectrum holding in 900 MHz, 1800 MHz and 2100 MHz band as

shown in Table below:

Licensee Licensee A Licensee B

Spectrum Band 900 MHz

1800 MHz

2100 MHz

900 MHz

1800 MHz

2100 MHz

Spectrum holding (MHz)

6.2 3 5 0 4.4 5

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Currently, both the Licensees ‘A’ and ‘B’ are liable to pay SUC as per

the existing slab based rated on the basis of total spectrum holding in

900 MHz and 1800 MHz bands.

Post-sharing SUC rates applicable in following three scenarios are

given the Table below:

Scenario I: They share their spectrum in the 1800 MHz band.

Scenarios II: They share their spectrum in the 2100 MHz band.

Scenario III: They share spectrum in both 1800 MHz and 2100 MHz

bands.

SUC rate for Licensee A SUC rate for Licensee B

Prior to Sharing

SUC Post Sharing

Prior to Sharing

SUC Post Sharing

Scenario I: Sharing in only 1800 MHz Band

6% 6.5% 3% 3.5%

Scenario II: Sharing in only 2100 MHz Band

6% 6.5% 3% 3.5%

Scenario III: Sharing in both 1800 and 2100 MHz Band

6% 6.5% 3% 3.5%


DoT View

(a) Regarding requirement of liberalisation prior to sharing in paras

2.9 and 2.10 may be seen.

(b) The TRAI in its recommendation of 2010 regarding SUC in case

of sharing of spectrum, recommended, among others, the

following:

“Spectrum usage charges will be levied on both the operators

individually but on the total spectrum held by both the operators

together. In other words, if an operator X having 4.4MHz of

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spectrum shares 4.4 MHz of spectrum of another operator Y,

then both X and Y will be liable to pay spectrum usage charges

applicable to 8.8 MHz of spectrum.”

(c) Government has decided the following:

The Spectrum Usage Charges (SUC), as prescribed by the Govt.

from time to time, will be levied on both the operators

individually for the total spectrum held by both the operators

together.

(d) Following type of SUC regimes are prevalent:

a. Rates of SUC vary with methodology of allotment of

spectrum i.e. (i) allotted administratively or (ii) through

auction process in 800 MHz, 900 MHz, 1800 MHz and

2100MHz bands.

b. Further, the rates of SUC vary with quantum of spectrum

and provisions of the NIA for auction of spectrum through

which spectrum has been allotted.

c. In case of spectrum in 2100 MHz (3G), the prescribed

rates of SUC as NIA for auction of spectrum in 2010 are:

(i) The spectrum charge for the 3G Spectrum shall be

payable on total AGR of 2G and 3G services taken

together;

(ii) Slab rate for standalone 3G operators shall be equal to

the lowest slab rate i.e. 3% of AGR;

d. In case of spectrum in 2300/2500 MHz (BWA), the

prescribed rates of SUC as NIA for auction of spectrum in

2010 is:

Licensees using BWA Spectrum need to pay 1% of

AGR from services using this spectrum as annual

spectrum charge irrespective of the licence held by

them. Such revenue would be required to be

reported separately.

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e. Spectrum Usage Charges (SUC) has been prescribed for

the spectrum in 900 MHz and 1800 MHz bands, as per

the Order No. P-14010/01/2014-NTG dated 31st October

2014.

f. Spectrum Usage Charges (SUC) has been prescribed for

the spectrum in 800 MHz, 900 MHz, 1800 MHz and 2100

MHz bands, as per the Order No. P-14010/01/2014 dated

5thFebruary, 2015.

(e) In view of above applicable SUC rates, particularly the weighted

average SUC prescribed rates, TRAI is requested to reconsider

the SUC to be applicable in case of sharing.

(f) The example in Table showing sharing of spectrum in 2100 MHz

band in Scenario II and III, indicates sharing even when

Licensee A does not hold spectrum in 2100 MHz band, which is

not as per recommendation of TRAI in para 2.4.

Response of TRAI

(a) TRAI’ Response given in Para 2.9 and 2.10 may be referred to.

(b) to (e)

Please refer to Para 1.3 and 1.4 of the recommendations on

spectrum sharing dated 21st July 2014, wherein the

Authority’s earlier recommendation on spectrum sharing given

on 11th May 2010 and the Government decision taken on the

same had been discussed.

Keeping in view the complexities involved in determining the

SUC for various quantum of spectrum acquired through

different methodologies, the Authority in its recommendations

dated 9th September 2013 had recommended that SUC for all

auctioned spectrum should be at a flat rate of 3% of AGR of

wireless services. The reasons for the same are available in

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paras 5.1 to 5.32 of its recommendations of 9th September

2013.

As far as SUC in case of spectrum sharing is concerned, the

Authority has recommended that the SUC rate of each of the

licensees post-sharing shall increase by 0.5% of AGR. Keeping

the SUC regime simple and unambiguous is one of the

foremost objectives of this recommendation.


recommendations.

(f) In its back reference, the DoT has erred in reproducing the

table given in example at page no. 10 of the Authority’s

recommendations, due to which it has incorrectly pointed out

that spectrum holding of one of the licensee in 2100 MHz band

has been shown as NIL. In fact, both the licensees have

spectrum holding in 1800 MHz and 2100 MHz band, where

sharing of spectrum has been considered to illustrate the SUC

post spectrum sharing.

13. Para 2.23

Spectrum Caps:

As discussed in Para 2.22, additional capacities created through

spectrum sharing cannot be counted at par with those created through

spectrum acquired through auction/trading. However, considering the

fact that spectrum sharing results in better spectral efficiency, a

portion of additional capacity created needs to be counted for the

purpose of applying the prescribed spectrum caps of 25% of total

spectrum assigned and 50% in a band. For the limited purpose of

applying the prescribed market caps, the spectrum holding of any

licensee post-sharing shall be counted as given below:

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50% of the spectrum held by the other licensee in the band being

shared shall be counted as the additional spectrum being held by the

licensee.

Example: Licensee ‘A’ and ‘B’ have spectrum in quantum X and Y

respectively in a band, in which they decide to share their spectrum.

The spectrum holding in that band subsequent to sharing, only for the

purpose of applying the stipulated spectrum cap, shall be considered

as per the following table.

Quantum of spectrum in a band before sharing

Quantum of spectrum after sharing that will be counted as the spectrum being held in this band for the purpose of applying the stipulated spectrum cap

Licensee ‘A’ X X+(Y/2)

Licensee ‘B’ Y Y+(X/2)


DoT View

The TRAI in its recommendations of May 2010 recommended, among

others, the following:

Permission for spectrum sharing will be given for a maximum

period of 5 years. There shall be no renewal.

Spectrum sharing will be allowed only between parties each of

whom does not have more than 4.4MHz /2.5 MHz (GSM/CDMA)

of spectrum.

Sharing will be allowed only if there are at least six operators in

the LSA, post-sharing arrangement.

Spectrum sharing will not be permitted among licensees having

3G spectrum.

The Government decided the following:

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Cabinet Decision

Sharing of spectrum without any additional one time spectrum

charge, be permitted between TSPs that have both paid for spectrum

beyond 4.4 MHz (GSM) / 2.5 MHz (CDMA.) without any change in

the terms and conditions of licence for use of spectrum including the

carrier size indicated therein. Both TSPs would have to pay

spectrum usage charge at the slab rate applicable on the entire

combined spectrum holding.

DOT Decision on 15.2.2012

Spectrum usage charges will be levied on both the operators

individually but on the total spectrum held by both the operators

together. In other words, if an operator ‘X’ having 4.4MHz of

spectrum shares 4.4 MHz of spectrum of another operator ‘Y’, then

both ‘X’ and ‘Y’ will be liable to pay spectrum usage charges

applicable to 8.8 MHz of spectrum.

It is noted that the spectrum sharing results in better spectral

efficiency and the benefit of which shall accrue to both. Further,

impact of consolidation of spectrum being similar there appears to

be no reasonable justification for differentiating the spectrum

holding in the case of M&A, spectrum trading, spectrum sharing or

standalone basis.

TRAI is requested to reconsider this recommendation.

Response of TRAI

Please refer to Para 1.3 and 1.4 of the recommendations on

spectrum sharing dated 21st July 2014, wherein the Authority’s

earlier recommendation on spectrum sharing given on 11th May

2010 and the Government decision taken on the same had been

discussed.

As discussed in Para 2.23 above, additional capacities created

through spectrum sharing cannot be counted at par with those

19

created through spectrum acquired through auction/trading.

Therefore, the Authority has taken a considered decision to

make the above recommendations in case of sharing of

spectrum.

Documents

Recommendations On Guidelines on Spectrum Sharing · Recommendations on “Guidelines on Spectrum Sharing” to the DoT on 21st July 2014. 3. Many of the recommendations have been